Abby Huntsman gets a few more things wrong on 'entitlements'

By By Michael Hiltzik

Mar 28, 2014 | 9:38 AM

Still trying, but still a teensy bit wrong: Abby Huntsman on MSNBC's "The Cycle." (MSNBC)

Let's acknowledge at the top that Abby Huntsman, one of the four anchors of MSNBC's youth-oriented news show "The Cycle," has taken on an ambitious task for herself: She's been trying to discuss U.S. fiscal policy, which is chock full of complicated concepts, in her allotted snippets of 3 1/2 minutes at a time.

Under the circumstances, it's not surprising that some of these concepts get the once-over-lightly treatment. That's not bad in itself, and kudos to Huntsman for even trying. I sympathize with her, I really do, because it's also not easy to write about these things in snippets of 1,000 words or so, which is what I'm doing here.

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The problem arises when the information Huntsman imparts to her audience is wrong. That's why two weeks ago I took issue with her treatment of Social Security, which bristled with rank misconceptions and bogus statistics.

On Thursday, Huntsman, who is the daughter of former GOP presidential hopeful Jon Huntsman, responded to my piece with another installment of her "Abby's Road" segment. I think she conceded one of my points -- it's a little hard to tell -- but she added a few more misconceptions and some suspect numbers. Let's unpack this one.

Huntsman's general point is that the U.S. is overspending itself into "financial quicksand," which will be very bad for her generation. The answer, she said, is to rein in "entitlements," by which she means mostly Social Security, Medicare and Medicaid.

Her first data point is that the government is "set to lay out $3.8 trillion" in the coming fiscal year, of which 70% "is for mandatory spending programs, mostly Social Security, Medicare, Medicaid and interest on the federal debt."

"This is basic math," she said.

Well, no, it isn't. Huntsman has put her thumb on the scale here. Two thumbs, even. That $3.8 trillion is a big number -- she enunciated it with special oomph -- but it was given with no context. So how big is it? It represents a hair more than 21% of gross domestic product, which sounds enormous until you consider that the average of federal spending as a share of GDP has been 20.5% over the last four decades.

So, yeah, a bit high, but the pathway to quicksand? Not so much. Plus, it's come down quite sharply over the last few years, from a peak of 24.4% in 2009, when GDP was hobbled by the recession and relief spending was growing.

Huntsman's other thumb is the lumping together of the social insurance programs with debt interest and a bunch of other things she doesn't mention, to get to 70%. You wouldn't know that Social Security, Medicare and Medicaid, Huntsman's prime targets, actually come not to 70% of the budget, but 48%. Is that a lot? You can judge for yourself, as long as you realize that 48 is less than 70 -- a lot less -- and that means plenty of spending gets crammed into that mandatory-spending category that isn't Social Security or Medicare.

Huntsman complained that I called her out for asking how we're going to pay the rising costs of the health and social insurance programs, as though "even raising the question means you're automatically anti-Social Security or against the elderly."

No. I called her out for raising the question using bogus numbers, such as life-expectancy rates from birth, which have risen sharply since the '30s but aren't relevant to Social Security's fiscal health. Instead, the key figure is life expectancy from age 65, which hasn't risen very sharply. (Huntsman appears to accept this point.)

Huntsman offered several possible remedies for rising costs in these programs -- means-testing benefits, increasing the retirement age, raising the Medicare eligibility age to 67 from 65 -- and complained that we're not even debating these options.

That's where she really goes off the rails. We have been debating those options, for years. They've all been studied, measured, calculated and scored. The reason they haven't been implemented is that none of them is simple. None of those she listed would have an appreciable positive effect on the fiscal health of the programs, and some, such as raising the Medicare eligibility age, might make the overall federal budget picture worse.

These options all create winners and losers, and the ones Huntsman listed tend to make losers of working-class folks and winners of the rich. For example, means-testing Social Security benefits, which is an option favored by anti-Social Security billionaires such as Pete Peterson: 84% of all Social Security benefits go to people with income of less than $30,000 a year. So for means-testing to make a dent, you'd have to start eating away at those people's retirement benefits, which average less than $12,000 a year.

Interestingly, the one idea that would make a huge difference for Social Security -- raising the income cap on the payroll tax -- is the only one Huntsman specifically dissed. "Liberals in particular might like that more," she cracked.

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Well, liberals and the economists at the Congressional Budget Office, who say it would have a greater effect than any other option outside of taking a hatchet to everyone's benefits.

The most curious aspect of Huntsman's case is that in the name of making Social Security and Medicare "sustainable" for her generation, she seems to favor options that would hurt her generation particularly badly. She asked what's wrong with "slowly increasing the retirement age for people who are decades away from when they might actually receive their benefits"?

But isn't that her audience? Isn't she advocating leaving benefits in place for older workers but slashing them for today's young? The "basic math" is that for every year the retirement age is increased, benefits are effectively cut by about 6.5%. Raise it now for people whose retirement is decades away, and by the time they reach that age they may not have very much to live on.

That's why people who propose benefit cuts and higher retirement and eligibility ages as the only acceptable options for these programs are often treated as being "anti-Social Security or against the elderly." They quite often have an ulterior motive -- undermining the public acceptance of those all-important programs. And quite often, their goals are couched in the language of "making them sustainable," as Huntsman did.

Perhaps Huntsman has strayed into that trap because of the constraints of a tight TV time frame. Or perhaps she actually does think these programs should be done away with, slowly, so that members of her generation won't realize they're gone until they need them.

One can't tell unless she lays out her case more thoroughly, without shorthand and without fakey statistics. But that would take more than 3 1/2 minutes.